Less than a month ago, Apple Inc.'s stock crossed $300 and now it's poised to pass the $400 mark, according to a handful of analysts.
Shares could rise 29 percent to $410 per share from their current level of about $317, says William V. Power, an analyst with R.W. Baird. He initiated coverage of Apple Thursday and gave the company an inaugural rating of "Outperform."
The question of Apple's target price has been a subject of debate, as the stock has been rising steadily since the first quarter of 2009 and no one is sure how long this unabated growth will continue.
Power is the latest analyst to predict that Apple shares will reach $400 or more. Data from FactSet Research shows that at least five Wall Street analysts think the shares could reach at least $400 apiece, with the most optimistic estimate at $450. On average, 38 analysts polled by FactSet expect the shares to reach $370.50.
Calling Apple the "unabashed premium provider in the burgeoning smartphone market," Power said he believes Apple's market share in mobile devices, such as phones and tablets, will only continue to grow.
The reason, he says, is that while the iPhone is an undisputed success in the U.S., it only commands 3 percent of the global smartphone market. If Verizon Communications Inc. begins selling the iPhone in 2011, as he expects, Apple's pool of potential new customers will sharply increase, even in the U.S.
All told, Power expects Verizon to sell 40 million iPhones in 2010, followed by 59.5 million in 2011 and 70.9 million in 2012.
In addition to the iPhone's seeming infallibility in the marketplace, Power said he assigned Apple an "Outperform" rating because the company has shown that it can successfully pioneer new categories, as it did with the iPad and, a decade ago, the original iPod.
Apple shares rose $5.08 to $317.88 in afternoon trading.